Published : 2014-07-23 19:50
Updated : 2014-07-23 19:50
The Korean economy is facing increasing long-term growth challenges, including high household debt and an aging population, according to a report by Standard Chartered Bank.
Strong exports and record-high foreign exchange reserves may bring about short- and mid-term growth, but slow domestic consumption, rising household debt and falling employment quality pose a risk to the economy’s future, the bank said in the report.
“South Korea’s economy is like a glass that’s half empty or half full,” it said, adding that the country has improved at the macro level but faces challenges at the micro level.
Commenting on Finance Minister Choi Kyung-hwan’s deregulation plans, the bank said raising the loan-to-value and the debt-to-income ratios would “spur further domestic economic activity and revive the domestic market.”